Cola category gaining 5% annually, says HCCB CEO Christina Ruggiero

Christina Ruggiero also added that “lack of data” is the reason behind the misconception that this total category is declining in the sixth largest market for the American giantRicha Maheshwari | ET Bureau | September 21, 2017, 16:30 IST

The carbonated drinks business in the country is growing 5% annually in value, the chief executive officer of Coca-Cola’s bottling arm has said, denying any decline in the category.

“Since July we are seeing a double digit growth,” Christina Ruggiero, CEO at Hindustan Coca-Cola Beverages (HCCB), said on Wednesday. “We are not getting out of the sparkling game,” she said, adding that the company is growing at 5-6% year on year.

Ruggiero, who took the reins of HCCB in April, blamed “lack of data” for the misconception that the carbonated drinks category is declining in the sixth largest market for Coca-Cola.

Industry watchers said growth in the segment is mostly driven by non-urban population.

“There is a health orientation today in the urban crowd where low calorie drinks, fruit-based drinks, milk and meal supplement drinks are gaining prominence. Growing in this market could be a challenge (for cola firms), unless there are innovative products in the above categories,” said Sreedhar Prasad, partner at KPMG. “For the rest of India, carbonated drinks still hold a cool status and the purchase is both need for summers as well as a cool drink to be associated with.”

Ruggiero said HCCB is now working on 20 pilot products and plans to launch them in the next 18 months. “These include juices, carbonated beverages, frozen desserts and local products,” she said at the inauguration of its CNG-based boiler system at its factory in Bengaluru.

Coca-Cola is now using local language labelling on its beverage brand cans and bottles in a bid to attract local consumers and take on fiercely competitive regional rivals. PepsiCo, too, is also using local words in languages such as Hindi, Punjabi, Marathi, Gujarati, Bengali and more on Pepsi bottles and cans sold in those states.

While individually, regional brand shares are minuscule, together they have about 10% share in the carbonated soft drinks market in the country, pegged at Rs 22,000 crore.

Coca-Cola also plans to replicate its learnings from the Indian market and implement localisation technique across the world, Ruggiero said.